The Enron Loophole and Your Gas Prices

In only two years, the price of crude oil — which accounts for 75 percent of gasoline prices — has more than doubled, from $60 a barrel to $140. Why?

The biggest cause is not OPEC, or increased demand from China. Instead, it's that same fun bunch that brought us the collapse in today's housing market: rich speculators, working through global investment banks and hedge funds.

Most Americans who find themselves being robbed at the pump have no idea that faraway commodity traders are manipulating the price of crude using a mischievous mechanism known as the "Enron Loophole."

This creates an electronic casino game, allowing global speculators to bet on the future price of oil, using a few facts, wild guesses and chicken entrails as the basis for their bets, which artificially drive up the price of oil. Hedge funds at Goldman Sachs and Morgan Stanley, for example, own huge amounts of these oil futures, and they're already accepting bets as high as $200 a barrel — a price completely unattached to the real cost of producing oil or to such niceties as supply and demand.

Worse, their gambling on our prices is done with no public oversight. That's because a special loophole says that electronic trading of such commodities as oil is not subject to the normal government rules that prevent price distortions. This loophole was written by Enron lobbyists, rammed through Congress in 2000 by then-Sen. Phil Gramm and signed by Bill Clinton. The resulting speculative oil bubble has jacked up our pump prices by a third, costing you and me about $1,500 each over the past two years — with much more to come out of our pockets as speculators raise their bets.

By the way, John McCain's top economic advisor is Phil Gramm, who recently convinced McCain to oppose efforts to close the Enron Loophole.

RIGHT-WING WARDROBE SILLINESS

Those goofy right-wing wardrobe police are at it again, getting goofier by the day.

First came the flag pin flap.

So now the yappers have found another target for their fashion fanaticism: Rachael Ray. Yes, the perky Food Network celebrity is being assailed by the right wing for promoting Muslim extremism and terrorism. It seems that Ray appeared in a Dunkin' Donuts ad, ostensibly to hype the fast food chain's iced coffee. But the ever-vigilant rightists saw through the coffee, frantically pointing to the scarf that Ray was wearing. It has a black-and-white pattern with long white fringe. A-ha, shrieked the yappers, that's a kaffiyeh, the kind of Arab headdress worn by the likes of Yasser Arafat and Muslim suicide bombers.

Don't you see, yelped the right-wing chorus, Rachael Ray and Dunkin' Donuts are not selling coffee, their ad is signaling symbolic support for the Islamic fiends who hate America! We must stop anyone from wearing the dreaded scarf, they yelled.

Never mind that Ray's scarf is a paisley design having nothing to do with terrorism. And never mind that Kaffiyehs are worn every day in the Mideast by teachers, workers and others having no connection whatsoever to terrorism — there's no level of silliness too extreme for the right-wing monitors of wardrobe correctness.

To find out more about Jim Hightower, and read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate web page at www.creators.com.

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